Government and Private Enterprise, 1968
Government and private corporations began intertwined after World War II. In 1968, state, local, and the national governments purchased 20% of the Gross National Product (the total value of goods and services produced in the country). Government provided much of the money for research and development and 82% of the nation's engineers and scientists received federal financial support. Massachusetts Institute of Technology, a non-government institution, received 80% of its budget from the federal government. The federal government was spending huge sums for war; between 1945 and 1968, it spent $1 trillion for warfare matters but only 6% of the national budget for health, education, and welfare. In the 1945-1960 period, government funds accounted for 60% of the income of aircraft companies, 23% of radio and television manufacturers, and 265 for machine shop companies.
The outflow of US private investment abroad meant that many large corporations received 50% or more from their overseas activities. One consequence is that the US government became more active in protecting these corporations in foreign countries as well as trying to further their interests. By 1968, most Americans were employed by large corporations. Corporate profits rose twice as fast as wages in the 1960s but they rose fast enough to improve the standard of living and to generate support for the corporations.